CONTRACT TUTORIAL QUESTIONS

1. Mark who is migrating on the 1st February sent a letter to Dan offering to sell him his
BMW car for $3M. He was to return his acceptance in the course of Post.

By a letter also dated the 1st February, Mark informed Joe that he was Living Room
Suite for $500,000.00. He stated in the letter that the offer would remain open until the
10th February.

Dan received Mark’s letter on the 3rd February and returned his acceptance letter by post
immediately. However, he sent the letter to 15 Hopie Drive instead of 50 Hopie Drive, so
the letter never reached Mark. Having not heard from Dan, Mark sold the car to Barak,
his best friend.

Joe upon receiving Mark’s letter called him and informed him that in his opinion, the
living room suite was overpriced and he would only pay $200,000.00. This is rejected by
Mark and eventually Joe said he would pay the $500,000.00. Mark informs him that he is
not interested in selling the furniture to him.

Mark informed Michelle by letter also of 1st February that he was selling his plasma tv
for $75,000.00. She was to let him know by 5th February if she would purchase same.
Michelle left a message on his voicemail on the 4th February. Mark retrieved the
message on the 5th February and sold the T.V. to James on the 6th February.

Dan Joe and Michelle have all turned up for their goods, however they discovered that
Mark had sold then to somebody else. They all plan to sue him for breach of contract .

Advise Mark on all issues arising.

2. On Tuesday, September 10, John delivered a written offer to sell a house to Mary. The
offer stated that “This offer is to be left over until Thursday, 10 o’clock, September 12.”
On Wednesday, John sold the house to Jill. Lance found out about the sale to Jill and told
Mary.
At 8 a.m. Thursday, Lance acting as the agent of Mary, handed John a letter of
acceptance.

John had also posted an offer to sell his car to Ken . On the 1st September, John posted a
revocation of his offer. The offer from John was received by Ken on the 4th September
and a letter of acceptance was sent the same day. On the 10th September, John’s letter of
revocation reached Ken.

Mary and Ken are contemplating suing John and John has come to you for advice.
Advise John.

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3. John deciding that too much clutter was around him also sent a letter to Kit, informing
him that he was offering to sell him his computer and printer along with the bedroom
set for a total of $50,000.00. He further stated that Kit should:

“….let me know by notice in writing on or before September 25 if you accept

Kit received the letter on the 14th September. Upon seeing that the offer was a literal
give away, he sent John a facsimile stating that he accepted. He also simultaneously
posted his letter of acceptance. John did not get the fax and the letter until the 27th
September. The fax machine was out of order until that date.

By then, John had sold the computer and printer to Maxie, his next door neighbour.

Kit is contemplating suing John and John has come to you for advice. Advise John.

4. Racquel is a 10 year old genius who is attending University. She is in need of an Ipad
to access her lecture notes for classes. Racquel visited the Bookshop on campus and
managed to use her persuasive skills to negotiate a contract with Ed to purchase the Ipad
in 4 installments of $25,000.00 every 6 weeks. Racquel made the first payment from her
savings, received the IPad from Ed but had difficulty finding the funds for the other
payments and has defaulted.

Ed wants to sue her for the balance of $75,000.00. Whilst telling someone in his store
about Racquel, another student who overheard asks Ed if he was talking about the 10 year
old genius. Ed is rather surprised upon hearing her age.

Advise Ed.

5. Andrea has a computer for sale which she advertised in the newspaper. No one
responded to the advertisement, however her brother Rick told her that he would
purchase same. Kim, Andrea’s best friend has advised her not to sell to her brother.

Shortly after that she gets a call from Janet who saw the ad. She is interested in
purchasing the computer. She calls back shortly after and left a message on Andrea’s
telephone stating that she wants to know if a printer also comes with the computer.
Andrea has decided to go ahead and sell to her brother Rick. He want to pay her on a
monthly basis for the computer. Advise Andrea if she should or should not proceed with
the sale to Janet or Rick.

6. Define Consideration and explain the requirements for consideration to be valid.

7. Gordon, an avid art collector visited a private art gallery owned by Leonardo, in upper
St. Andrew. He immediately fell in love with a collection of three paintings and was told
by Leonardo that they were originals done by the renowned artist, now deceased, Horatio.

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Believing the price of $3,000,000.00 to be a small fortune to pay, as he thought that they
should be worth at least $15, 000,000.00, Gordon gave Leonardo his cheque for the
$3,000,000.00.

Later in the day, upon closer scrutiny of the paintings, Gordon discovers that they were
prints on canvas and is livid. He also discovers that it was not “Horatio” but “Honcho”
that was written on the canvas. He calls the bank and hears that the cheque was already
cashed. He goes back to the house where the gallery was and finds a property well locked
up and empty on the inside. The prints are worth $20,000.00 in total.

Gordon has come to you for advice. Advise Gordon.

8. (a) Milly and Guy have agreed to purchase a car from Douglas. Unknown to all
parties, at the time of them signing the contract, the ship taking the car to Jamaica sank.

They also asked Mary in September to purchase some orchids for them in the Phillipines.
Mary agreed to send them on “The Malta”, a ship coming to Jamaica from the
Phillipines. Mary booked them on a ship called “Malta” which was to arrive in October.
Milly and Guy thought to themselves that this was great as they had other goods booked
for a ship called the “Malta” which was scheduled to arrive in December, just in time for
the Christmas shopping, so they could really make some profit from the orchids then.

Early in October, they got a call from Mary that the Orchids were in Jamaica. Guy and
Milly are shocked as this was not what they expected.

Advise Milly and Guy on all issues arising.

(b) With the use of cases, explain unilateral mistake.

9. With the use of cases, explain what is promissory estoppel.

10. (a) With the use of cases, illustrate when an exemption clause may become a term of
the contract.

(b) Duke and Duchess went on a weekend trip to Pleasure Hotel, Mobay. At the
reception desk, they signed a contract form which they never read and paid for the
weekend. One of the terms of the contract was that the cars of customers were
parked at owners risk and that the hotel will not be responsible for looking after
the cars.

On getting to their room, they found a notice pasted on the wall stating that the
hotel will not be responsible for any missing or stolen items from the rooms. They
read the notice but never took it seriously. On the last night of their stay,
Duchess’ diamond ring was stolen from her suitcase in the room and Duke’s car

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was stolen from the hotel’s parking lot. Both Duke and Duchess intend to bring an
action against Pleasure Hotel for the cost of the ring and card.

Advise Duke and Duchess.